FALL 2010
Course No.: 9200-710 (& 810)-001
Course ID:  85723 & 85725
Time: M, W 4:45-6:15 p.m.
Room TBD
Professor Jay Dratler, Jr.
Across from Room 231D (IP Alcove)
Home: 330-835-4537
Copyright © 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2008, 2010  Jay Dratler, Jr.  
For permission, see CMI.

Questions and Notes on the "Skunk Works" Case

and the Liability of Domain-Name Registrars

1.  Both courts, by summary judgment, held that NSI made no "commercial use" of Lockheed Martin's registered "Sunk Works" trademark.  What was their rationale for that conclusion, and do you agree?

Recall that, for purposes of a dilution claim, the Toeppen court held that registering someone else's famous trademark as a domain name and attempting to sell the domain name to the trademark owner was commercial use.  Are the results in the two cases consistent?  Are the decisions in this case consistent with the "vanity telephone number" decisions that the district court reviews?

2.  Consider the economic implications of this decision.  If you were Lockheed Martin's general counsel, would you rather sue the individual domain-name registrants, most of whom appeared to have been scientists, engineers, hackers, and hobbyists, and some of whom may have had past or present relationships with Lockheed Martin?  Or would you rather sue NSI?  Which defendant(s) might better control the Internet traffic that you seek to curtail?  Which defendant(s) might better respond in damages?  Which lawsuit might engender less anger from the public?

If this case had come out the other way, wouldn't NSI (and now every other domain-name registrar as well) be an obligatory defendant in any domain-name dispute involving any trademark-related cause of action?  How would that fact affect domain-name registrars?  the smooth operation of the domain-name registration system?  the price of registration?  Would these results be good or bad for consumers?  for the Internet?

Should courts consider such economic implications of their decisions, or should they decide cases only on grounds of "neutral" doctrine?  Should they consider economic implications in cases like this, in which the issue of "commercial use" is a close one?

3.  The Ninth Circuit's opinion introduces us to the concept of "contributory infringement."  In essence, contributory infringement involves inducing or helping someone else to infringe.  So, in every case of "contributory" infringement, there must be a primary or direct infringer.  That is, there must be someone to whose infringement the alleged contributory infringer contributed.  Who were the primary or direct infringes and who was the alleged contributory infringer in this case?

4.  Is "contributory infringement" an obscure, academic doctrine—a "makeweight" in litigation—or is it economically important?  If this case had come out differently, wouldn't domain-name registrars be named as "contributory" co-defendants in every case alleging a trademark-related cause of action? Can you see why contributory infringement, at least on the Internet and the World Wide Web, is not likely to remain obscure?

5.  Was the Ninth Circuit right to affirm rejection of the contributory infringement claim without even investigating the state of NSI's knowledge of the infringement?  Could NSI have successfully argued lack of knowledge after receiving all of the warning letters from Lockheed Martin?  If not lack of knowledge, what was the basis of the Ninth Circuit's near-categorical rejection of the contributory infringement claim?  Was the court right to distinguish the present case from Inwood, in which a generic drug company continued to supply its pills to pharmacists in "look alike" capsules, knowing that pharmacists often supplied its pills to consumers instead of the look-alike proprietary drug?  Was the court right to distinguish this case from the landlord-tenant cases and flea-market cases?

6.  Could NSI be analogized to the publisher of a "Yellow Pages" telephone directory?  Should such a publisher be liable for contributory trademark infringement or unfair competition in publishing infringing trademarks chosen by advertisers?  What effect does Lanham Act § 32(2), 15 U.S.C. § 1114(2), which the Ninth Circuit quotes in its opinion, have on resolving these issues?

7.  One month after the Ninth Circuit's decision in this case, Congress amended Lanham Act § 32(2), 15 U.S.C. § 1114(2), by adding current paragraph (D).  See Intellectual Property and Communications Omnibus Reform Act of 1999, Title III (Trademark Cyberpiracy Prevention), § 3004, Pub. L. No. 106-113, Division B, Appendix I (S.1948), 106th Cong., 1st Sess., 113 Stat. 1501A-549 through 1501A-550 (Nov. 29, 1999).

How would Section 32(2) have affected the outcome of Lockheed Martin?  What protection does the statute give domain-name registrars like NSI against trademark-related actions based upon their registration of others' domain names?  against actions based upon their refusal or cancellation of others' registrations grounded upon third-party claims?

Suppose you are general counsel for a domain-name registrar. Outline a "legal compliance program" for your client taking maximum advantage of the statute and specifying what the client should do when faced with various types of domain-name disputes.  Try to cover all contingencies addressed in the statute.

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